Steel Authority of India Limited

Basic Materials — Steel · NSE

₹170.95+₹0.66 (+0.39%)

DalalBaazaar Score

57 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Moderate

Driven by short-term liabilities exceed short-term assets.

In simple words: The business is earning a fairly low return on the money invested in it, with modest growth. Short-term liquidity is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:45 pm

Understanding the Business

Company site ↗

The 60-second version of Steel Authority of India Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Steel Authority of India Limited, a steel-making company, manufactures and sells iron and steel products in India and internationally.

IndustrySteel

SectorBasic Materials

Employees49,752

Annual revenue₹1.10 L Cr

How does it make money?

Turns over ₹1.10 L Cr a year. Of every ₹100 of sales, about ₹3 reaches shareholders as profit, with ₹12 left at the operating level before interest, tax and depreciation. Each of its 49,752 employees supports ₹2.21 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹2.21 Cr

Who are its competitors?

The closest listed comparisons in its industry are TATA STEEL LIMITED, JSW STEEL LIMITED, JINDAL STEEL LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 7.2% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE10.8%

What is the outlook?

15 analysts covering the stock expect revenue to grow about 5.2% and earnings to fall about 12.8% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+5.2%

Est. earnings growth-12.8%

Analysts15

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +6% while net margin moved +46% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+6%

Margin effect+46%

DalalBaazaar Score

57/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROE of 5.6% is weak

Quality vs. Valuation

Company Quality

52/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

74/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

16.5x

3Y Median

23.0x

40 monthly readings · mean 22.3x · range 14.2x–35.6x

Sector Median

19.8x

median of 3 sector peers

🟢Current valuation is approximately 28% below its 3y median of 23.0x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 17% below the peer median of 19.8x.

vs. its own history

Cheap

23.0x median over 40 months · -28%

vs. sector peers

Fair

19.8x median of 3 peers · -17%

vs. generic bands

Fair

15x–35x

EV/EBITDA

7.6x

PEG

1.05

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from 9.1% to 12.2% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

1 item require attention · 1 watch

🟡Short-term liquidity is tightFinancial
Current ratio of 0.82 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 9.1% to 12.2%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Priced below its own history
The stock trades 28% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Growth barely outpaces inflation
Revenue compounding at 2.0% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 10%✓ 12.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA stays below 2x✗ 2.4x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
3Interest cover stays above 3x✓ 3.1x
How much operating profit can fall before interest stops being comfortably covered.
4Revenue growth stays above 4% a year✗ 2.0% CAGR
Latest reported year was 1.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5Free cash flow remains positive✓ ₹10,281 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

6 / 12 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✗ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✗ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 4 neutral · 2 weak

Market Cap

₹70,611 Cr

Mid Cap

Mid-sized — more growth headroom, but sharper swings than large caps

P/E (Trailing)

16.5x

Fair

Fairly valued against the generic band

P/B Ratio

1.17x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹10.34

Profitable

Profitable on a per-share basis

ROE

5.6%

Weak

Weak capital efficiency

ROCE

7.2%

Weak

Low return on total capital employed

Debt/Equity

0.53x

Low

Conservative leverage

Revenue Growth (YoY)

1.3%

Modest

Modest growth

Profit Growth (YoY)

121.1%

Healthy

Profits growing at a healthy clip

Dividend Yield

1.37%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹10,281 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

10.8x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

9.9%

Average

Average margins

Net Margin

3.8%

Average

Average bottom-line conversion

Current Ratio

0.82

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

1.04

Market-like

Moves roughly in line with the market

52W Range Position

55%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

176.4 / 179.6

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

31.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1.04 L Cr	₹1.05 L Cr	₹1.02 L Cr	₹1.10 L Cr	+2.0%
EBITDA	₹9,445 Cr	₹12,473 Cr	₹12,031 Cr	₹13,401 Cr	+12.4%
EBITDA Margin	9.1%	11.9%	11.8%	12.2%	—
PAT (Net Profit)	₹2,177 Cr	₹3,067 Cr	₹2,372 Cr	₹3,373 Cr	+15.7%
EPS	₹5.27	₹7.42	₹5.74	₹8.17	+15.7%
ROE	4.0%	5.4%	4.0%	5.6%	—
ROCE	5.9%	7.4%	6.7%	7.2%	—
Total Debt	₹30,773 Cr	₹36,323 Cr	₹36,934 Cr	₹31,928 Cr	+1.2%
Free Cash Flow	-₹9,212 Cr	-₹1,800 Cr	₹3,693 Cr	₹10,281 Cr	—

🟡 Revenue has been broadly flat over 3 years (2.0% a year).

🟢 EBITDA has grown at 12.4% a year over 3 years.

🟢 EBITDA Margin has risen from 9.1% to 12.2% over 3 years (+3.1 pts).

🟢 PAT (Net Profit) has grown at 15.7% a year over 3 years.

🟢 EPS has grown at 15.7% a year over 3 years.

🟢 ROE has risen from 4.0% to 5.6% over 3 years (+1.6 pts).

🟢 ROCE has risen from 5.9% to 7.2% over 3 years (+1.3 pts).

🟡 Total Debt has been broadly flat over 3 years (1.2% a year).

🟢 Free Cash Flow has turned positive, from -₹9,212 Cr to ₹10,281 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1.36 L Cr

Total Liabilities

₹75,540 Cr

Cash & Equivalents

₹29 Cr

Operating Cash Flow

₹19,039 Cr

Capex

-₹8,758 Cr

Shareholding (proxy)

Institutional Holding

17.3%

Insider Holding

65.1%

Corporate Actions

Next Earnings

29 Oct 2026

Dividend Rate

₹2.35

Ex-Dividend Date

30 Sept 2026

Analyst Consensus

Recommendations

11 Buy · 5 Hold · 12 Sell

Target Price (Mean)

₹179.5

+5.0% vs CMP

Target Range

₹135 – ₹240

Peer Comparison

Company	P/E	ROE
TATA STEEL LIMITED	19.8x	10.8%
JSW STEEL LIMITED	12.0x	24.7%
JINDAL STEEL LIMITED	39.1x	5.3%

Recent News

1 positive3 mixed2 general

What Steel Authority Of India Holders Bought Into

Simply Wall Street, 14 Oct

SAIL FY26 PAT Rises 50%, Recommends Dividend ₹2.35

scanx.trade, 15 OctCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Steel Authority Of India Ltd. (SAIL) Share Price Rise Streak: SAIL rises in second straight session

Univest, 12 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Steel Authority: SAIL shares rebound after falling for two sessions amid market rally | Target, stop loss for investors

Livemint, 09 OctPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Stock Radar: SAIL stock hits fresh record high in May; time to buy or book profits?

The Economic Times, 26 May

Steel Authority of India shares fall 2.25%

Moneycontrol.com, 10 AugPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongGrowth · Valuation

MiddlingBusiness Quality · Financial Health · Risk

WeakProfitability

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you.

2 of 5 tripwires tripped — Debt / EBITDA stays below 2x; Revenue growth stays above 4% a year · see Key things to watch ↑